Carolina Energy

    By Jim Brumm
    WILMINGTON, North Carolina, Sept 24 (Reuters) - SCANA Corp <SCG.N> said two of its subsidiaries in South Carolina are planning to sell $85 million of tax-free debt this fall.
    The offering by the U.S. energy group's units will be composed of industrial revenue bonds issued by the South Carolina Jobs-Economic Development body and will be underwritten by BB&T Capital Markets, SCANA spokesman Bryan Hatchell said on Tuesday.
    In orders posted last week, the Public Service Commission of South Carolina approved the sale of bonds by Dec. 23 with maximum maturities of 40 years.
    Noting the current conditions of the bond market, Hatchell said South Carolina Generating Co. (GENCO) and South Carolina Electric & Gas Co. (SCE&G) will market the bonds this fall with timing depending on market conditions.
    According to Public Service Commission orders, GENCO can sell up to $50 million of bonds to help pay for scrubbers being installed at the William Electric Generating Station near Charleston, South Carolina, a 650-megawatt, coal-fired power plant operating since 1973.
    The sulfur dioxide removal equipment scheduled to begin operation next year is now expected to cost more than $170 million, according to SCANA's website.
    Another $9 million is being spent on a barge-offloading and coal-conveying facility at the plant to allow increased imports of low-sulfur coal from anywhere in the world.
    SCE&G, SCANA's utility subsidiary, received permission to sell $35 million of bonds to pay part of the cost of scrubbers being installed at its largest power plant, the 700 megawatt Wateree Electric Generating Station located at Eastover, South Carolina, southeast of the state capitol of Columbia.
    The scrubbers were expected to cost $200 million by the time they go into operation next year. Wateree began commercial operation in 1970.
(Additional reporting by Michael Connor in Miami; Editing by Leslie Adler)
((michael.connor@reuters.com; +1 305 810 2688; Reuters Messaging: michael.connor.reuters.com@reuters.net)) Keywords: SOUTHCAROLINA BONDS/
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<SCG.N>
Wednesday, 24 September 2008 12:42:48RTRS [nN24446360] {EN}ENDS

Duke gets N.C. clearance for two gas power plants
Thu Jun 5, 2008 5:47pm EDT
WILMINGTON, N.C., June 5 (Reuters) - The North Carolina Utilities Commission on Thursday approved Duke Energy Carolinas's plans build two 620-megawatt combined cycle, natural gas-fired generating units, the utility said.
The Duke Energy Corp (DUK.N: Quote, Profile, Research) subsidiary said the new power plants will be built at two existing facilities -- the Buck Steam Station in Rowan County and the Dan River Steam Station in Rockingham County.
The company said it will be ready to begin construction at the Buck facility once it receives the necessary air permit from North Carolina. Construction at Dan River would follow.
In early May, Duke said a $275 million contract was signed with Shaw Group Inc to build the new Buck plant, planned for operation as early as the summer of 2010.
The utility said both projects employ state-of-the art environmental control technology to minimize plant emissions and will use cooling towers to minimize the impact on the Yadkin and Dan Rivers.
The use of cooling towers will also minimize potential generation curtailments during drought conditions.
Duke Energy Carolinas has a long history in the communities surrounding the Buck and Dan River sites -- generating electricity at the Buck Steam Station since 1926 and at the Dan River Steam Station since 1949.
The utility's operations include nuclear, coal-fired, natural gas and hydroelectric generation providing nearly 21,000 megawatts of electricity to more than 2.3 million electric customers in a 24,000-square-mile service area of North Carolina and South Carolina. (Reporting by Jim Brumm; Editing by Tom Brown and David Gregorio)

NC utilities boost power line spending to $523 mln
Tue Jun 3, 2008 2:34pm EDT
By Jim Brumm
WILMINGTON, N.C., June 3 (Reuters) - North Carolina's utilities have raised the amount they expect to spend on new transmission lines over the next decade to $523 million from the $400 million projected in January.
Citing requests for power transmission made under the Federal Energy Regulatory Commission's Open Access Transmission Tariff, the North Carolina Transmission Planning Collaborative said two major transmission projects have been added to the list of those that need to be built by 2017.
The Transmission Planning Collaborative was formed in 2005 at the urging of the North Carolina Utilities Commission to develop a shared plan for needed improvements in the state's electric transmission system.
Participants include the Carolina operating units of Duke Energy Corp (DUK.N: Quote, Profile, Research), Progress Energy Inc (PGN.N: Quote, Profile, Research) North Carolina Electric Membership Corp., representing the state's rural cooperatives; and ElectriCities of North Carolina, representing municipal utilities.
The co-ops and municipal systems are distribution utilities that depend on North Carolina's two regulated, vertically integrated utilities -- Duke and Progress -- to own and operate the state's power plants and transmission lines.
In a statement on Monday, the Collaborative said the revision completed in mid-May identifies 18 major transmission projects needed over the next decade.
It put the estimated cost of the two new projects at $115 million, explaining the expected cost of the other 16 projects has increased $8 million since January, resulting in a $123 million increase in the total cost. (Editing by Tom Brown)

Rate increase would fund nuclear plant
Jim Brumm/Independent-Mail
Originally published 10:10 p.m., June 3, 2008

South Carolina Electric and Gas Co. has asked the Public Service Commission of South Carolina to increase the utility’s electric rates to pay the financing costs for the nuclear power plants planned for construction at the Summer Nuclear Station near Jenkinsville.
Contracts for the power plants were announced last week by SCE&G and Santee Cooper, which will share the $9.8 billion cost. Anderson (SC) Independent-Mail, May 28, 2008
SCE&G, the principal subsidiary of SCANA Corp., filed with state regulators Friday seeking approval of the plant and the utility’s plans to raise rates to recover the cost of financing its planned investment of $5.4 billion in the plant.
The financing plan proposed by SCE&G would raise rates 0.49 percent in March 2009 and another 2.8 percent in October 2009. That would be followed by increases in each of the next 10 years. The first increase will be about 53 cents a month for SCE&G customers using 1,000 kilowatt hours of power per month, which now costs $107.60, according to utility spokesman Robert Yanity.
As a state-owned utility, Santee Cooper does not need to seek Public Service Commission approval of its investment in the power plant.
The utility has not decided how to include its costs for the nuclear power plants in the rates it charges to the state’s 20 electric cooperatives, spokeswoman Mollie Gore said Monday.
She noted the utility planned to pay for its $4.4 billion share of the cost with available cash and borrowings.
Santee Cooper has no rate changes planned through 2010, Gore said, adding that means the earliest the nuclear costs could be included in rates is 2011.

13:08 11May2008

Duke Energy signs deal on 620 MW gas power plant

WILMINGTON, N.C., May 11 (Reuters) - Duke Energy Carolinas has contracted to build a 620-megawatt gas-fired power plant at a cost of $275 million, the Duke Energy Corp subsidiary said in documents filed with the U.S. Securities and Exchange Commission.
The company's contract with Shaw Group Inc calls for construction of a combined cycle, natural gas-fired power plant at Duke's Buck Steam Station on the Yadkin River between Charlotte and Winston-Salem, North Carolina, according to the filing, made late on Friday.
The plant is subject to approval by the North Carolina Utilities Commission, which is expected to act in the next four or five weeks, Duke spokeswoman Paige Sheehan said by e-mail on Saturday.
Duke plans to begin operating the plant in simple cycle mode by the summer of 2010 and combined cycle mode a year later, the filing said.
Duke said in December that two older, coal-fired units will be retired at the Buck Steam Station.
The utility said the new plant is part of its long-term plan to add generation and modernize its fleet of power plants, which includes a similar gas-fired plant at Duke's Dan River Steam Station, an 800-MW coal-fired power plant under construction at Cliffside, North Carolina, and a 1,117-MW nuclear power plant proposed for operation in 2018 at a South Carolina site.
Duke Energy Carolinas' operations provide nearly 21,000 MWs of electricity to more than 2.3 million customers in North and South Carolina. (Reporting by Jim Brumm, editing by Jane Sutton and John Wallace)
((miami.newsroom@reuters.com; +1-305-810-2688; Reuters Messaging: jane.sutton.reuters.com@reuters.net))

Keywords: DUKEENERGY/PLANT
Sunday, 11 May 2008 13:08:22RTRS [nN5B554011] {C}ENDS

North Carolina gas utilities seek higher return
Thu Apr 3, 2008 4:38pm EDT
By Jim Brumm
WILMINGTON, N.C., April 3 (Reuters) - North Carolina's two largest natural gas distribution utilities are seeking to raise their return on equity to 12 percent, effective November 1, in general rate cases filed with state regulators.
The filings were posted on the North Carolina Utilities Commission Web site late on Wednesday.
In a statement, Piedmont Natural Gas Co said it was seeking a 4 percent, $41 million increase in annual revenues and a permanent extension of the decoupling of gas sales volumes and revenues granted on a pilot basis in the company's rate case three years ago.
The decoupling was authorized by the North Carolina legislature in the Customer Utilization Tracker (CUT) bill passed in 2007.
Piedmont spokesman David Trusty said the increase is designed to support an allowed return on rate base of 9.17 percent, up from the 8.79 percent allowed three years ago when the return on equity was set at 8 percent.
Without the requested rate increase, the filing shows Piedmont's actual return on rate base dropping to 7.19 percent.
PSNC Energy, which also wants to implement the CUT rate decoupling mechanism, said it was seeking a 2.99 percent, or $20.4 million, increase in annual revenues. The company's filing seeks a 9.36 percent return on rate base.
That's up from the 8.9 percent allowed by regulators two years ago in the company's first rate case following the acquisition of Public Service Co of North Carolina by SCANA Corp (SCG.N: Quote, Profile, Research) in 2001, SCANA Investor Relations Manager Bryan Hatchell said.
In the 2006 case, PSNC sought a 9.84 percent return on rate base and was granted an 8.9 percent return, Hatchell said.
He noted that return on equity in that case was "a black box" and not disclosed. (Editing by Christian Wiessner)

17:30 19Mar2008 RTRS-

NC asked to halt Duke power plant construction
By Jim Brumm
WILMINGTON, N.C., March 19 (Reuters) - Two environmental groups have asked North Carolina regulators to order a halt to construction of Duke Energy Corp.'s Cliffside plant while they reconsider the air quality permit granted to the coal-fired power plant.
Charging that North Carolina's Division of Air Quality violated state and federal laws when the permit was granted in January, NC WARN -- the North Carolina Waste Awareness & Reduction Network --- and Appalachian Voices on Wednesday filed separate appeals with the state's Office of Administrative Hearings.
Both were part of a coalition of environmental groups that wrote a letter to the division in early March requesting it reconsider the permit for the 800 megawatt plant, due to be completed in 2012 at an estimated cost of $2.4 billion.
Construction began in late January, a day or two after the permit was issued.
Division officials have not responded to that letter, division spokesman Tom Mather said.
"On air quality alone, the permit is flawed," NC WARN attorney John Runkle told reporters on Wednesday.
He noted the "irony" of allowing Cliffside construction to proceed while North Carolina's attorney general is suing the Tennessee Valley Authority , claiming its coal-fired plants are polluting national parks in the state.
The trial over that suit is due to begin July 14 in Asheville, North Carolina.
The potential harm to national parks in Tennessee, Virginia and North Carolina was cited by the National Parks Conservation Association in filings that encouraged Virginia's Air Pollution Control Board to take control of the evaluation of a 585 MW coal-fired power plant Dominion Resources Inc has proposed for an abandoned mine site in Wise County, Virginia.
The request will be considered when the board meets Thursday in Alexandria. Until now, evaluation of the plant located northwest of St. Paul in far western Virginia has been managed by the state's Department of Environmental Quality, the National Parks Conservation Association said a statement.
In early March, the Virginia Attorney General's Office and State Corporation Commission staff reached an agreement recommending approval of the plant if Dominion's Virginia Power subsidiary gives up state incentives for clean-coal plants.
Among other things, this would reduce the return on equity invested in the plant to 12.12 percent from the 13.75 percent the company proposed.
(Editing by Michael Christie; Editing by Marguerita Choy)
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Wednesday, 19 March 2008 17:30:57RTRS [nN19337877] {EN}ENDS

Duke Energy boosts bank line to $3.2 billion
Fri Mar 14, 2008 5:32pm EDT
WILMINGTON, North Carolina, March 14 (Reuters) - Duke Energy Corp (DUK.N: Quote, Profile, Research) has increased its credit line with banks led by Wachovia Corp (WB.N: Quote, Profile, Research) to $3.2 billion from $2.65 billion, the utility holding company said in an 8K filing with the U.S. Securities and Exchange Commission.
The expanded credit line increased the borrowing sub limits for Duke Energy Ohio Inc and Duke Energy Indiana Inc to $750 million and $700 million respectively, the 8K said.
The two subsidiaries previously had sub limits of $500 million and $400 million, respectively, spokesman Tom Williams said Friday.
He declined to say how much Duke had drawn down under the original credit line agreed to in July 2007.
Joining Wachovia in committing $230 million to the credit line are JPMorgan Chase & Co (JPM.N: Quote, Profile, Research), Bank of America Corp (BAC.N: Quote, Profile, Research), Barclays PLC (BARC.L: Quote, Profile, Research), Citigroup Inc's (C.N: Quote, Profile, Research) Citibank, The Bank of Tokyo-Mitsubishi UFJ, and Credit Suisse Group (CSGN.VX: Quote, Profile, Research). Sixteen other banks made commitments to the line ranging from $50 million to $125 million.
The amendment expanding the credit line "was entered into to increase the financial flexibility of Duke Energy and its utility subsidiaries," the 8K noted.
In lowering Duke Energy's rating outlook to stable from positive, rating service Moody's said that given the company's intention to finance the capital investments announced last September largely with debt, its key "credit metrics are no longer expected to improve and, most likely, will deteriorate over the next few years.
"This financial metric erosion is most notable at Duke Carolinas, which (Moody's believes) will represent a majority of the capital investment plans over the near term."
Those investments include the Cliffside power plant under construction in Western North Carolina and one nuclear power unit in Northwestern South Carolina which is now projected to come online in 2018.
Charlotte, North Carolina-based Duke Energy delivers energy to some 4 million U.S. customers with about 36,000 megawatts of electric generating capacity in the Midwest and the Carolinas, and natural gas distribution services in Ohio and Kentucky. In addition, the company has more than 4,000 megawatts of electric generation in Latin America, and is a joint-venture partner in a U.S. real estate company. (Reporting by Jim Brumm; Editing by Marguerita Choy)

09:26 07Mar2008

N.C. groups seek to block coal-fueled power plants
By Jim Brumm
WILMINGTON, N.C., March 7 (Reuters) - Two North Carolina-based environmental groups have sued U.S. officials to block $1 billion in tax incentives granted to nine coal-fueled power plants.
Meanwhile, 19 other organizations have asked state regulators to re-examine the air quality permit granted to one of the plants, Duke Energy Corp's Cliffside coal-fired power plant, now being built in western North Carolina.
Two opponents of Appalachian coal mining, Appalachian Voices and the Canary Coalition of Sylva, said they filed suit in the U.S. Court for the District of Columbia this week.
The suits argue that the clean-coal tax credits granted under the Energy Policy Act of 2005 constitute "major federal actions" that require the government to hold environmental studies of the plants.
"The fact is that there's no such thing as clean coal as long as our mountains are getting clear-cut, blown up and bulldozed down," Appalachian Voices Executive Director Mary Anne Hitt said in a statement.
Of the nine experimental coal facilities that have received tax incentives, the statement says, none has conducted an environmental impact study, as required by the National Environmental Policy Act.
In addition to Cliffside, credits have been approved for three Integrated Gasification Combined Cycle projects planned by Duke in Edwardsport, Indiana; TECO Energy Inc. in Polk County, Florida; and Southern Co's Mississippi Power in Kemper County, Mississippi.
Credits were also approved for a Bradford, Kentucky, coal-fired plant planned by E.ON AG's LG&E Energy subsidiary; a Carson, California, hydrogen plant planned by BP Plc and Edison International ; and a Longview, Texas synthetic gas plant planned by TX Energy LLC.
In Raleigh, North Carolina, the Southern Environmental Law Center petitioned the N.C. Division of Air Quality to modify or revoke the air quality permit granted the Cliffside power plant on Jan. 29, claiming it violates requirements for regulation of hazardous air pollutants under the federal Clean Air Act.
In a letter supported by 17 other groups, the center said a court ruling last month that the U.S. Environmental Protection Agency violated the Clean Air Act when it scrapped a policy that required the best available technology to capture power plant mercury emissions means the division must reopen the permit to address mercury emissions.
Division of Air Quality officials were reviewing the letter and the federal appeals court ruling, spokesman Jamie Kritzer said, noting the group has until the end of March to file a formal appeal of the permit.
(Editing by Michael Christie and Walter Bagley)
((miami.newsroom@reuters.com; +1 305 810 2688; Reuters Messaging: michael.christie.reuters.com@reuters.net)) Keywords: ENERGY COAL/NORTHCAROLINA
Friday, 07 March 2008 09:26:48RTRS [nN07318518] {C}ENDS

Duke Energy nuclear proposal clears first NRC hurdle
Jim Brumm/Special to the Independent-Mail
Wednesday, February 27, 2008

Click to see on the Independent-Mail website.
CHARLOTTE, N.C. — The U.S. Nuclear Regulatory Commission has approved a Duke Energy Corp. license application for the proposed William States Lee III Nuclear Station and docketed the proposal for the next stage of review, Duke officials said Wednesday.
The 8,000-page application to build a two-unit nuclear power plant in Cherokee County, S.C., was submitted to the commission in December 2007.
"The NRC's acceptance of our license application confirms that, based on an initial review, it is technically sufficient for the NRC's more comprehensive review," said Bryan Dolan, Duke Energy vice president of nuclear plant development.
Roughly a month after the application was filed, Duke officials told the North Carolina Utilities Commission the company plans to proceed with building one of the announced two units while pursuing licensing of two 1,117 MW units because of the uncertainty associated with possible future efforts to control carbon emissions from coal-fired power plants.
Duke’s Chief Nuclear Officer, Henry B. Barron Jr., said there is “no material increase in costs” for obtaining a license for two units rather than a single unit, while “seeking a license for a single unit, then separately pursuing a license for a second unit would result in incurring unnecessary costs.”
Duke officials said the Lee Nuclear application now will enter the detailed NRC review process, which includes requests for additional information, visits to the proposed plant site and opportunities for public input. The NRC will publish its review schedule within 30 days.
The plant is planned for a tract south of Gaffney, S.C., where Duke started construction of a three-unit nuclear power plant in the late 1970s. That effort was abandoned in the mid-1980s after Duke had spent $600 million in the preconstruction costs.

N. Carolina utilities want to offer carbon offsets
Mon Feb 18, 2008 4:31pm EST

By Jim Brumm
WILMINGTON, North Carolina (Reuters) - The North Carolina utilities owned by Duke Energy Corp and Progress Energy Inc have told the state Utilities Commission they intend to offer "carbon offsets" as part of their existing green power programs.
In a letter sent to the commission late Friday and released by Duke on Monday, the utilities said they are in discussions with NC GreenPower about expanding its existing programs to include the purchase of carbon credits.
NC GreenPower is a non-profit organization established in 2003 to improve the state's environment through voluntary contributions toward renewable energy -- "the first statewide green energy program in the nation supported by all the state's utilities," according to the group's Web site.
The site says 12,940 North Carolina electricity users have subscribed to its programs, funding the generation of 30.86 million kilowatt hours of electricity a year with renewable resources such as solar, wind, landfill methane and small hydro.
Duke spokeswoman Paige Sheehan said this is one type of carbon offset the utilities want to expand by providing power users a way to buy carbon credits.
NC GreenPower spokesman Jeff Brooks said the group is "very early in discussions" with the utilities.
Although the method of providing offsets has not been worked out, the program's target is the 41,000 pounds of carbon emissions the U.S. Environmental Protection Agency calculates the average household of two people is responsible for each year, Sheehan said.
The utilities told the commission the NC GreenPower Board is expected to act on the expansion at its late March meeting.
Once a program is in place, the utilities' letter said, Duke Energy Carolinas and Progress Energy Carolinas will revise their tariffs to include the carbon offset option. (Editing by Dan Grebler)

Energy plan could save electric, gas customers
State is first in nation to see energy saving idea OK'd by PSC

Originally published 09:20 p.m., February 4, 2008
Updated 09:20 p.m., February 4, 2008

Click to see on Independent-Mail website

ANDERSON COUNTY — By Jim Brumm

Special to the Independent-Mail

COLUMBIA — Duke Energy’s unique energy efficiency proposal took a giant step toward reality last week when the company reached a settlement with representatives of the utility’s South Carolina customers.
Among other things, the settlement means Duke’s commercial and residential customers already have prepaid their costs for the first three years of the energy efficiency program, Duke spokesman Andy Thompson said.
The settlement calls for these over collections, totaling $87 million, to be refunded over the next three to four years, covering the initial commercial and residential customer charges called for by the efficiency program, he said.
The energy efficiency plan is supposed to save money by reducing energy consumption.
Users will pay a bit more for each kilowatt hour of electricity consumed — the incentive for Duke, which will use that money to provide ways for its customers to reduce use. The expectation is the total cost will be less for customers, although the cost per unit will be more. To see if it really works, Duke agreed to a full review of the program after two years.
The agreement between Duke Energy Carolinas, the Office of Regulatory Staff (ORS), Wal-Mart Stores Inc and the South Carolina Energy Users Committee was filed Wednesday with the state Public Service Commission (PSC). That puts South Carolina on track to be the first state to approve an incentive rate structure to provide for recovery of energy efficiency costs, ORS Executive Director Dukes Scott said in a telephone interview.
Late last week, the other regulated energy supplier in Duke’s northwestern South Carolina service area — Piedmont Natural Gas Co. — signed on to the settlement, Mr. Scott said.
That leaves the Southern Environmental Law Center, the Coastal Conservation League and the Southern Alliance for Clean Energy as the "non-settling intervenors" at PSC hearings on Duke’s proposal scheduled for today Tuesday and Wednesday in Columbia. Intervenors are parties who comment on filings.
While industrial customers start paying for the cost right away under last week’s settlement, the midweek filing states that industrial and commercial customers who have taken energy conservation steps on their own are allowed to opt out of the proposed program.
The agreement also calls for Duke’s rate base to include 85 percent of costs avoided because of efficiencies implemented as a result of the program instead of the 90 percent proposed by Duke in its filings in South Carolina, North Carolina and Indiana. (The assets Duke uses to produce and distribute electricity — power plants, wires, repair trucks, etc — are the utility's rate base. The utility commission determines the return it will allow Duke to earn on its investment in these assets. This return, plus costs such as pay and fuel purchases determine the rates charged.)

Duke settles with SC customers on efficiency plan
Fri Feb 1, 2008 4:44pm EST
By Jim Brumm
WILMINGTON, N.C., Feb 1 (Reuters) - Duke Energy Corp's (DUK.N: Quote, Profile, Research) Carolinas subsidiary has reached a settlement with representatives of its leading South Carolina customers over a proposed energy efficiency program.
The agreement between Duke Energy Carolinas, the state Office of Regulatory Staff, Wal-Mart Stores Inc (WMT.N: Quote, Profile, Research) and the South Carolina Energy Users Committee was on filed Wednesday with the state Public Utilities Commission.
It puts South Carolina on track toward becoming the first state to approve an incentive rate structure to provide for recovery of energy efficiency costs, ORS Executive Director Dukes Scott said in a telephone interview.
According to the filing, the settlement allows large industrial and commercial customers who have taken energy conservation steps on their own to opt out of the proposed program
It also calls for Duke's rate base to include 85 percent of the costs avoided because of efficiencies implemented as a result of the program, instead of the 90 percent proposed by Duke in its filings in South Carolina, North Carolina and Indiana.
The amount of avoided costs will be based on Duke's peak power costs, Scott said.
Another result of the pact is no initial costs for Duke's South Carolina customers.
At the suggestion of the ORS, according to Duke spokesman Andy Thompson, the $87 million in demand-side charges over-collected in the state over the past five years will be refunded over the next three to four years, covering the initial charges to customers called for by the efficiency program.
The proposal filed in North Carolina calls for residential customers to pay a "Save A Watt" rider that will start at 1.4 percent and increase to about 4 percent by year four, Thompson said.
For industrial and commercial customers, he said, the rider would add 1.4 percent to 1.6 percent to average power bills the first year. This is expected to increase to about 2.7 percent by year four.
The actual amount of power consumed would go down by 5 percent to 10 percent, if these customers actively participate in energy efficiency programs, resulting in a lower power bill, Thompson said.
Another provision added by the settlement is a complete review of the program after two years, Scott said.
Asked why Piedmont Natural Gas Co had not signed on to the settlement, he said the Raleigh, North Carolina-based natural gas distributor wanted a broader program.
Piedmont Chief Executive Thomas Skains told the commission he had "serious concerns with the 'electric only' focus" of some of Duke's programs.
Scott said Piedmont's concern was "one we're going to have to address" during hearings scheduled for next Tuesday and Wednesday. (Editing by Walter Bagley)

UPDATE 1-Duke Energy gets final approval for N.C. plant
Tue Jan 29, 2008 4:31pm EST

(Adds Duke comments at news conference, paragraphs 7-11)

By Jim Brumm

WILMINGTON, N.C., Jan 29 (Reuters) - North Carolina's Division of Air Quality on Tuesday issued a final air permit for Duke Energy Carolinas' Cliffside coal-fired power plant.
The Duke Energy Corp (DUK.N: Quote, Profile, Research) subsidiary said after the decision that construction of the 800 MW unit about 50 miles (80 km) west of Charlotte "is expected to begin immediately."
The decision by the state agency bucked a trend in other states, like Florida and Kansas, where regulators have indicated they no longer favor coal-fired power plants amid a growing acceptance in the United States of the seriousness of global warming.
But the North Carolina state government agency did insist on the retirement of older and more polluting Duke plants in issuing the air permit for the new unit.
"Cliffside will be producing substantially more power while cutting back its emissions of key pollutants," the agency's director, Keith Overcash, said in a statement.
The permit would require the new plant to use the best available air pollution controls and demands that Duke shut down four older units at Cliffside.
In addition, the permit is based on an agreement by Duke Energy to make the new power plant "carbon neutral" by 2018, six years after it is scheduled to come online, utility officials told a news conference.
Noting that the new plant is expected to produce about 6.5 million tons of carbon dioxide a year, the company's Chief Strategy Officer Keith Trent said about two thirds of this will be offset by retiring 1,000 MW of older, less efficient generating units.
This includes four units in the Cliffside complex and 800 MW elsewhere in North Carolina, Duke said.
"Previously the company had committed to retire up to 800 MW only if it achieved an equivalent amount of energy efficiency savings," the company noted.
Trent said the final third of the carbon offsets is expected to be achieved through conservation and the construction of the Lee nuclear plant, now planned for operation in 2018.
According to documents on Cliffside filed by Duke with North Carolina's Utilities Commission, the capital cost of building the new plant will be an estimated $1.8 billion.
In addition, financing is currently expected to increase the cost to ratepayers by another $600 million. The company has been saying it expected to update the cost estimate following the issue of the air quality permit.
The Carolinas operations of Charlotte-based Duke provide nearly 21,000 MW of electricity to more than 2.3 million customers in a 24,000-square-mile service area of North Carolina and South Carolina.
The company also has some 15,000 MW of generating capacity and 1.7 million customers in the Midwest. (Editing by Michael Christie and Marguerita Choy)

13:56 29Jan2008

RTRS-Duke Energy gets final approval for N.C. plant
By Jim Brumm
WILMINGTON, N.C., Jan 29 (Reuters) - North Carolina's Division of Air Quality on Tuesday issued a final air permit for Duke Energy Carolinas' Cliffside coal-fired power plant.
The Duke Energy Corp subsidiary said after the decision that construction of the 800 MW unit about 50 miles (80 km) west of Charlotte "is expected to begin immediately."
The decision by the state agency bucked a trend in other states, like Florida and Kansas, where regulators have indicated they no longer favor coal-fired power plants amid a growing acceptance in the United States of the seriousness of global warming.
But the North Carolina state government agency did insist on the retirement of older and more polluting Duke plants in issuing the air permit for the new unit.
"Cliffside will be producing substantially more power while cutting back its emissions of key pollutants," the agency's director, Keith Overcash, said in a statement.
The permit would require the new plant to use the best available air pollution controls and demands that Duke shut down four older units at Cliffside.
Duke Energy said it would retire the four older, less efficient generating units with a capacity of about 200 MW once the new unit comes online in 2012.
The utility said it also agreed to the scheduled retirement of 800 additional MW of older, less efficient coal generating capacity elsewhere in North Carolina.
"Previously the company had committed to retire up to 800 MW only if it achieved an equivalent amount of energy," the company noted.
According to documents on Cliffside filed by Duke with North Carolina's Utilities Commission, the capital cost of building the new plant will be an estimated $1.8 billion.
In addition, financing is currently expected to increase the cost to ratepayers by another $600 million. The company has been saying it expected to update the cost estimate following the issue of the air quality permit.
The Carolinas operations of Charlotte-based Duke provide nearly 21,000 MW of electricity to more than 2.3 million customers in a 24,000-square-mile service area of North Carolina and South Carolina.
The company also has some 15,000 MW of generating capacity and 1.7 million customers in the Midwest.
(Editing by Michael Christie and Christian Wiessner)
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Tuesday, 29 January 2008 13:56:48RTRS [nN29611289] {EN}ENDS

New North Carolina power lines to cost $400 mln
Fri Jan 25, 2008 4:05pm EST
By Jim Brumm
WILMINGTON, N.C., Jan 25 (Reuters) - North Carolina's utilities now estimate the cost of new transmission lines needed over the next decade totals $400 million, an increase of 66 percent from a previous estimate a year ago.
That's the conclusion of the 2007-2017 Collaborative Transmission Plan, prepared by the representatives of the utilities meeting as the North Carolina Transmission Planning Collaborative, a group formed in 2005 at the urging of the North Carolina Utilities Commission to develop a shared plan for needed improvements.
Participants include the Carolina operating units of Duke Energy Corp (DUK.N: Quote, Profile, Research) and Progress Energy Inc (PGN.N: Quote, Profile, Research), the North Carolina Electric Membership Corp, which represents the state's rural cooperatives, and ElectriCities of North Carolina, which represents municipal companies.
The plan issued by the Collaborative identifies 17 major transmission projects costing more than $10 million each as being needed over the next decade, up from 14 pointed out by the group a year ago.
The latest plan also includes $52 million in increased cost estimates for the 14 projects identified last year.
Collaborative Chairman Ed Ernst, Duke's Director of Transmission Planning, said on Friday that the increased number of projects reflects North Carolina's growing population.
Ernst added that the utilities "believe the (state's) planning process is constant with what (the Federal Energy Regulatory Commission) is asking us to do."
In North Carolina, the co-ops and municipal systems are distribution utilities that depend on North Carolina's two regulated, vertically integrated utilities -- Duke and Progress -- to own and operate the state's power plants and transmission lines.
The plan calls for Progress to build 13 transmission projects at a cost of $280 million over the next decade while Duke plans two projects expected to cost $80 million. The 17th project, expected to cost $40 million when completed in June 2011, will be built jointly by the two utilities. (Editing by Michael Christie and Christian Wiessner)

SCANA unit sees improved return with rate hike
Mon Dec 3, 2007 11:25am EST

By Jim Brumm
WILMINGTON, N.C., Dec 3 (Reuters) - South Carolina Electric & Gas Co. (SCE&G) expects an improved return on equity as a result of a $76.9 million, or 4.4 percent, electric rate increase approved last week by the South Carolina Public Service Commission, utility spokesman Eric Boomhower said.
SCE&G, SCANA Corp.'s (SCG.N: Quote, Profile, Research) principal subsidiary, said the rate increase would have produced a return on equity of 10.75 percent in the test year ended March 31, 2007.
With the rates in effect during the test year, the company actually earned a return on equity invested in electric utility operations of 8.27 percent, Boomhower said.
Columbia-based SCE&G generates electricity and distributes it to 636,000 customers in 26 counties in the central, southern and southwestern portions of South Carolina.
Regulators granted the rate increase effective Jan. 1, 2008. The amount was unchanged from the request presented to the commission in October as part of the company's settlement with the South Carolina Office of Regulatory Staff and other parties following the utility's June 15 filing seeking an increase of $118 million, or 6.75 percent.
This rate hike submission, SCE&G's first since 2004, included a request the company be allowed a return on equity of 11.75 percent, the utility said. The settlement agreement reduced this to 11 percent, it added.
Previously, the allowed ROE was in a range of 10.4 percent to 11.4 percent, Boomhower said.
This compares to the 12.25 percent ROE Duke Energy Carolinas is allowed in South Carolina, according to Duke spokesperson Paige Sheehan. She said the Duke Energy Corp. (DUK.N: Quote, Profile, Research) subsidiary earned an ROE of 10.79 percent in South Carolina in 2006. (Editing by Michael Christie and David Gregorio)

15:11 30Nov2007

RTRS-NC regulators increase, delay Duke Energy rate cut

By Jim Brumm
WILMINGTON, N.C., Nov 30 (Reuters) - The North Carolina Utilities Commission (NCUC) said on Friday it has ordered Duke Energy Carolinas to cut rates by a total of $286.9 million in 2009, increasing the cuts' ultimate impact but delaying their effect.
The commission approved a $233 million-a-year electric rate cut effective in 2008, which the Duke Energy Corp subsidiary proposed in an agreement with its North Carolina power customers in early October, and took account of several items not included in the deal, the NCUC said.
One item was the recovery of $80.5 million in savings from Duke's 2006 acquisition of Cinergy, which was previously credited to North Carolina customers.
Robert Gruber, executive director of the utilities commission public staff, said this recovery next year will reduce the rate cut by $206 million in 2008, but the cuts would deepen in 2009.
"At first blush" the changes "appear to be a fair outcome for our shareholders," Duke spokeswoman Paige Sheehan said.
As a result of the changes, Gruber said, the rate reduction for residential customers will be 3.41 percent in 2008 instead of the 3.85 percent agreed on in October. In 2009, the reduction in residential rates will increase to 4.74 percent.
For commercial customers, the 2008 cut will be 6.5 percent instead of 7.34 percent and it will increase to 9.04 percent in 2009, Gruber said.
He said industrial rates go down 11.25 percent next year instead of 12.7 percent. This becomes 15.4 percent in 2009.
The commission said the $286.9 million revenue cut will reduce after-tax operating income by $168.7 million, noting this would have resulted in after-tax income from North Carolina electric operations of $671.3 million in the 2006 test year.
It also said the decision cuts Duke's overall allowed rate of return in the state to 8.57 percent from 10.72 percent.
Sheehan said Duke's actual return on its total rate base in North Carolina was 8.65 percent and its return on equity was 11.54 percent.
She said its permitted return on equity has been reduced to 11 percent by the rate agreement from the current 12.5 percent set in Duke's last North Carolina rate case in 1991.
By comparison, Sheehan said, Duke Carolinas had an actual 2006 return on equity of 10.79 percent in South Carolina where the allowed ROE is 12.5 percent.
She said actual ROE is not publicly reported for Duke Energy's operations in Ohio and Indiana, where the allowed ROE is 10.29 percent and 10.5 percent, respectively.
(Editing by Michael Christie and Braden Reddall)
((miami.newsroom@reuters.com; +1 305 810 2688; Reuters Messaging: michael.christie.reuters.com@reuters.net)) Keywords: DUKE/NORTHCAROLINA
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Friday, 30 November 2007 15:11:57RTRS [nN30315350] {EN}ENDS

Duke Energy sets $233 mln North Carolina rate cut
Fri Oct 5, 2007 7:22pm EDT
By Jim Brumm
WILMINGTON, N.C., Oct 5 (Reuters) - Duke Energy Carolinas agreed on Friday to cut its North Carolina electric rates by $233 million a year with the biggest cut going to the state's industries.
In a late afternoon filing with the state Utilities Commission, the Duke Energy Corp subsidiary said it had reached an agreement with Wal-Mart Stores Inc and other customers to reduce rates across the board when a rate freeze begun on July 1, 2000, ends at the end of 2007.
In July, the utility had filed for a $140 million rate increase.
The Duke subsidiary, which distributes electricity in North and South Carolina, said its North Carolina industrial rates will be cut 12.7 percent.
In addition, under a renewable energy bill passed by the state General Assembly this summer, all energy taxes paid by manufacturers will be phased out over the next five years.
Duke said residential rates will be reduced 3.8 percent under the agreement while rates for general customers will be cut more than 7 percent.

14:21 20Sep2007

S. Carolina power plant has first environmental OK
By Jim Brumm
WILMINGTON, N.C., Sept 20 (Reuters) - South Carolina's plans to build $998 million coal-fired power plant received the initial approval of state environmental authorities this week.
The state's Department of Health and Environmental Control said in an e-mail distribution that it planned to issue a draft air permit early next month for the Pee Dee Generating Station, proposed by state-owned electric utility Santee Cooper.
The DHEC said it would hold a public hearing on the plant in November. Conservation groups have asked for more study because they say coal-fired plants are major sources of greenhouse gases.
Santee Cooper has proposed building the plant on a 2,709-acre tract on the Great Pee Dee River 25 miles (40 km) southeast of Florence, South Carolina. The utility said it will be 370 megawatts short of capacity in 2012 if the plant is not built.
In particular, the utility's web site cites high demand from the Grand Strand, the coastal resorts near Myrtle Beach about 40 miles (64 km) southeast of the proposed site.
The board of the South Carolina Public Service Authority, Santee Cooper's formal name, has approved construction of a one-unit, 600-megawatt power plant on the site, spokeswoman Laura Varn said.
Because of the long process needed to get environmental approval, she added, utility management is seeking approval of a two-unit, 1,320-megawatt plant to allow quicker construction of a second unit should the board decide it is needed.
((Editing by Jim Marshall; Reuters Messaging: jim.loney.reuters.com@reuters.net; +1 305-810-2688; E-mail: miami.newsroom@reuters.com)) Keywords: ENERGY SOUTHCAROLINA/
Thursday, 20 September 2007 14:21:54RTRS [nN20426514] {C}ENDS

Progress adds $37 mln to NC transmission upgrade
Wed Jul 18, 2007 5:32PM EDT
WILMINGTON, N.C., July 18 (Reuters) - Progress Energy Inc. (PGN.N: Quote, Profile, Research) plans to invest another $37 million over the next four years to improve delivery of electricity to the western suburbs of Raleigh, the utility holding company said on Wednesday.
Progress Energy Carolinas, the company's subsidiary operating in North and South Carolina, said it will be building and upgrading about 22 miles of electric transmission facilities linking its Harris Nuclear Plant southwest of Raleigh with the state capitol's fast-growing suburbs.
The utility said the need for the additional upgrades was "confirmed" by North Carolina's first Collaborative Transmission Plan.
The plan was prepared last January by Progress Energy, Duke Energy Corp (DUK.N: Quote, Profile, Research), and associations representing the state's city-owned utilities and rural cooperative utilities.
It calls for an upgrade of facilities linking the Harris Nuclear Plant and the Research Triangle Park as part of some $400 million in transmission spending over the next decade agreed to initially by Progress and Duke Energy.
Total spending was cut to $294 million when the plan was updated in April, the group said.

Jim Brumm

Journalist